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Hellfire Club
22 October, 2007  
A slight case of "tendency"

The NSW Administrative Decisions Tribunal slots a Sydney barrister for negotiating a settlement that involved dropping a professional misconduct complaint against a slow paying solicitor


imageThe Administrative Decisions Tribunal says that five Wentworth’s David Keith Louis Raphael (pic) engaged in unsatisfactory professional conduct because he negotiated a settlement for his client, a solicitor, which involved an undertaking that a misconduct complaint against the client be dropped.

Misconduct proceedings against the solicitor, Peter Knudsen, were in train in 2002 in connection with money he owed Bathurst law shop McIntosh McPhillamy & Co.

The firm had complained to the NSW Law Society about Knudsen because he failed to honour an undertaking about the payment of counsel’s fees of $11,860 plus interest.

The Legal Services Commissioner has published a brief report of the disciplinary findings against Knudsen.

The arrangement that Raphael helped negotiate involved Knudsen paying $13,000, while McIntosh McPhillamy undertook to withdraw the complaint and promised not to give evidence in the proceedings against Knudsen.

imageHowever, McIntosh McPhillamy partner Christopher Nichols (pic) indicated that he would not resist a subpoena to give evidence, if one were issued by the Law Society.

In the event, the Law Society did subpoena him, and Nichols gave his “fullest cooperation”.

Over three years later, the NSW Bar Association thought this was serious enough to ask the ADT whether Raphael was guilty of unsatisfactory professional conduct or professional misconduct for negotiating this deal for his client.

The Bar n’ Grill alleged that Raphael sought to induce a material witness not to give evidence before the tribunal and obstructed the disciplinary proceedings.

Knudsen believed the complaint against him was a tactic to pressure him into paying the money, so it was thought only natural that withdrawing the complaint would be part of the settlement.

Raphael argued that he and the barrister for McIntosh McPhillamy were both experienced legal practitioners and their negotiations for a settlement indicated “peer approval of its terms and no cognizance of any impropriety”.

He submitted that the barristers involved had no intention of obstructing proceedings before the tribunal and the settlement actually didn’t have any such effect.

Also, he said that no part of the $13,000 paid by Knudsen to the law firm should be seen as consideration for declining to give evidence in the disciplinary proceedings.

However, it was the wording of his handwritten settlement offer to Nichols on behalf of Knudsen that upset the tribunal (Karpin, Robberds and Klika). It included these two paragraphs:

(a) That you will not swear any further affidavit nor will you offer to give evidence against Mr Knudsen in the proceedings instituted by the Law Society against him and numbered 012043/01; and

(b) That you will write to the Law Society within seven (7) days after payment of the said sum of $13,000.00 informing the Law Society that the undertaking has now been honoured and that you specifically decline to give evidence in those proceedings and will send a copy of that letter to Mr Knudsen of even date with that to the Law Society.

In cross-examination Raphael conceded that it was a major error of judgment to seek a promise from Nichols not to give evidence.

In retrospect he thought he should not have accepted these instructions from his client, but it did not occur to him at the time that the arrangement could be seen as an obstruction of justice.

However, the ADT thought that some of the $13,000 was consideration for the promise by Nichols not to give evidence.

It stressed that Raphael’s intention was irrelevant rather the question was, did the conduct have “the tendency to impair the tribunal’s capacity to do justice in the proceedings brought by the Law Society against Mr Knudsen”?

An intention to obstruct or interfere with the proceedings before the tribunal does not have to be proved in order for the barrister to be found guilty of unsatisfactory professional conduct.

The ADT applied NSW Bar Association v Meakes [2006] NSWCA 340 in determining that affidavits from three QCs, Priestley, Sullivan, and Slater, all supporting Raphael and testifying to “his good fame and character; his honesty and trustworthiness” were largely irrelevant.

It was also thought to be irrelevant that …

“subsequently Mr Nichols conferred with counsel for the Law Society and that he may have given the Law Society his fullest cooperation. The barrister’s conduct has to be gauged at the date when the settlement was agreed.”

The tribunal did not think Raphael had behaved in a way that could be regarded as “disgraceful or dishonourable by his professional brethren of good repute and competency”.

His actions did not amount to professional misconduct at common law or under the Legal Profession Act 2004.

The fact that negotiations took place when both Raphael and Kearney, for McIntosh McPhillamy, were out of their chambers – Raphael at his farm and Kearney driving to Bathurst – “were not circumstances conducive to mature deliberation”.

The ADT also indicated that “four lawyers were involved and none of them apparently saw anything wrong with what they were doing.”

Since the tribunal believed Raphael’s actions did have the tendency to impair its capacity to do justice in the Knudsen case, it came down with a finding of unsatisfactory professional conduct.

From Justinian’s perspective the whole thing seems lopsided. Justice was still done and Nichols gave evidence. If it was a “tendency” to impair the tribunal’s capacity to do its job, it was a tendency that went nowhere – either at the time settlement was negotiated or subsequently.

And why did it take the Bar n’ Grill three years to bring a case against the barrister?

No punishment has been meted out to date – and really it shouldn’t be more than a light once over with the feather duster.